Glencore Won’t Meet March 15 Deadline for Xstrata Takeover

March 1 (Bloomberg) -- Glencore International Plc, the
largest publicly traded commodities supplier, won’t complete its
$33 billion takeover of Xstrata Plc two weeks from today as
planned as it awaits a ruling from China on the deal.

“Given the ongoing regulatory process and the Xstrata
court timetable, it will not now be possible to complete by
March 15,” Glencore said in a statement. The Baar, Switzerland-based company didn’t give a new date, saying it would provide an
update on timing when it reports full-year earnings on March 5.

Glencore made its all-share bid for Xstrata in February
2012 and won investor approval for the deal in September. It’s
the third time the trader has pushed back the deadline to
complete a takeover that adds coal, nickel, copper and zinc
mines to create the world’s fourth-largest mining company.
Approval from China is the final hurdle to completing the
acquisition.

Glencore and coal producer Xstrata in January extended the
deadline to mid-March to allow for regulatory reviews in South
Africa and China. South Africa’s antitrust tribunal subsequently
cleared the deal after a Nov. 22 approval by the European Union.

China hasn’t any reason to reject the deal after regulators
elsewhere backed it, and the transaction doesn’t involve any
major business interest for the country, two Beijing-based
officials said in January, asking to not be identified because
they weren’t authorized to speak to the media.

MOFCOM Approval

Glencore fell 4 percent to 371.95 pence by 12:17 p.m. in
London, the biggest intraday decline since Sept. 7, while
Xstrata dropped 4.3 percent to 1,112 pence, also the most since
September. The FTSE 350 Mining Index was 2.8 percent lower.

China’s Ministry of Commerce, or MOFCOM, is responsible for
the decision. Glencore’s C$6.1 billion ($5.9 billion) takeover
of Canada’s Viterra Inc., completed in December, was delayed as
it awaited clearance under Chinese anti-monopoly law. Glencore
gained approval that month after extending the deadline at least
twice.

The ruling Communist Party’s omission of Commerce Minister
Chen Deming from its new central committee announced in November
was a signal that he may be stepping down from the post.

The government is expected to appoint new ministers at
legislative meetings that open March 5 in Beijing. Xi Jinping,
who was named head of the Communist Party and the military in
November, is set to be appointed president at the same meetings.